Mr. Speaker, I thank my colleague for her wonderful speech and also for splitting her time, allowing me to speak to this important motion. I also thank the member for Charlesbourg—Haute-Saint-Charles for bringing forth this motion. I have had the great pleasure of working with her in the past on the natural resources committee, and I am also pleased to support her fine work here today.
While I was doing my research for this speech, and of course the researchers are very helpful in this area, I happened upon a CANSIM table that looks at the percentage of unemployed people receiving EI regular benefits, stretching from 1976 right through to the current 2012. In 1976, 90% of those people who were unemployed were receiving EI regular benefits. That 90% figure dipped for a while through the 1980s, but also in 1990, 90% of the unemployed were receiving regular benefits. Then we entered into a free fall. We went from 90% eligible down to 80%, down to 70%, down to 60%. In the 2000s, we were under 50%, and currently we are under 40%. That is, only 40% of those people who are unemployed are receiving regular EI benefits.
That really is worrying to me. We are seeing a slow erosion of our social safety net programs. This is very disturbing. We are not seeing it just in this area. We are also seeing it in the old age security program and, looking at the other side, with young people and tuition levels and student loan allowances. It really is an erosion of our social safety net and it is punishing those people who are least able to make up for this lack of help.
Of course I support our motion. It is very important for the Conservatives to reassess what they are doing, not just on this pilot program but in all areas of the social safety net, to make sure Canadians' equality does not span just between groups in the current time but also over time, so that the people born today and in the future have the same opportunities and benefits that Canadians had before them. I am very worried that these programs are eroding what I would call generational justice.
I remind the House of the motion, which states that the new working while on claim pilot project is not benefiting many EI recipients who are able to find employment. In fact for many it creates a disincentive to take part-time work. It is leaving low-income Canadians worse off than before, and really the government needs to take steps to immediately fix this working while on claim project.
The motion stems from Conservative changes to the working while on claim pilot project. Early versions of this program had a clawback formula, which is really what we are talking about. In that, allowable earnings while on claim were equal to the greater of $75 or 40% of weekly benefits. For example, if weekly benefits are $300, the allowable earning would be $120. Earnings above that level were clawed back dollar for dollar. Under the new clawback formula, there are clawbacks of 50¢ on the dollar for every dollar up to 90% of the weekly insurable earnings. Any amount above that 90% of weekly insurable earnings is clawed back dollar for dollar.
It is a bit of bafflegab. We see these things written and they do not make a lot of sense, but when the rubber hits the road that is what really makes the difference. According to the Conservatives, these changes would incentivize all EI recipients to accept new work.
However, we found that the new pilot program discourages part-time or low-paying work for many EI recipients, and many of them will be making less than under the old system. For example, in 2010-2011 the average EI regular benefit was $360 a week; that is for the average person collecting this. That means previous earnings for the EI recipient were about $670 per week.
Under the new system the average EI recipient will have no incentive to accept new work unless that person earns over $300 per week. If the recipient takes one day of work or something like that and does not earn $300, of course he or she is not going to make any money. For example, if the person who made under $300 a week accepted work earning $150 per week, he or she could potentially lose $70 under the new system compared to the old system. Contrary to what we are hearing from the government, the new system would hurt the average EI recipient.
I am particularly concerned about the low earning EI recipient and will let the House know why in a minute, but would first like to clarify the details of the program.
If an EI recipient previously earned $300 per week, then that recipient could earn $165 per week when unemployed and receiving EI. Under the new system the recipient would have no incentive to accept new work unless he or she earned over $125 per week. That means that if this person, a low earning EI recipient, accepted work for $75 per week, he or she would lose $30 under the new system. It does not sound like a lot of money, but in the community where I grew up and to a lot of my constituents in Burnaby--Douglas, losing $30 is a lot. If we talk to anyone who is unemployed, $30 often makes a difference between fresh vegetables and something that is canned, for example.
This also does not include work-related expenses, such as transportation and child care. If these additional expenses were factored in, very few EI recipients would benefit from accepting new work, especially low earning EI recipients.
The effect on low income earners is something I understand very well, because I was once in this category myself. In my early twenties I lived in Nova Scotia. I worked at minimum wage jobs for a few years and then at one point I was laid off. I looked for work but could not find any. Lots of my friends were in the same situation. Lots of people would get a job, work hard, but the job would dry up. They could not find any other work, so like me they would apply for what was then called unemployment insurance. That helped us pay our bills while looking for work. It is not like we had trust funds that we could tap into, or something like that. It is not, as the Conservatives have alluded to, that people were lazy. It is just that the area where we were living did not have any work.
Of course, when I look back I could see that it was because we were youth. Youth unemployment is especially high. Right across Canada youth unemployment is 15% now, but in particular regions it can be 20%, 30% or 35%.
This was not a period that any of us felt good about. In our early twenties, my friends and I felt somewhat like failures. We had gone through high school, where we had done pretty good work. Some of us had received university degrees from the local college. However, none of us could really find work, so we would go on what was then called UI.
Every day while on UI we would go to what was then called a manpower centre. We often had to hitchhike or cycle there because it was so far away. It was not that we were not looking for work or trying hard. We made a lot of effort to do that. Back in the old days before computers, the manpower centre had little cards stuck on bulletin boards and sometimes there would be no cards there. Ten of us would show up after hitchhiking, cycling or walking there, only to find there was no work available and to be told to come back the next day. Sometimes there would be a little card on the bulletin board indicating that one day of work was available shovelling gravel, laying sod or something like that. We would play rock-paper-scissors so that we would not compete against each other for the one job and bother the employer. Or whoever needed the money the most could apply for the job. Often these jobs did not make much difference because sometimes the money was clawed back, and that was discouraging.
That is why we have to be careful with these programs. When sitting in a place like the House of Commons and making a good salary, it is easy to lose track of what it is actually like, or to have what fancy academics call an experiential perspective. Having an experiential perspective is to look from the perspective of the people who are actually affected by these programs. That is perhaps what has been lost here.
It is easy to look at the numbers, the graphs, the Statistics Canada data and all of that, but we should really be talking to the people on the ground and asking how this is affecting them. We have been hearing these stories in Parliament. We are respecting people's last names, but we have definitely been hearing calls in members' offices by people who are saying that a local person is losing a certain amount of money. The person had one cheque stating one amount and comes back with another cheque with a different amount, and there is definitely some money being lost. We can do the calculations and see that they are right.
This program therefore needs to be re-evaluated. The Conservatives should also be careful in their statements not to insult the hard-working people of Canada who are looking for work.